LSI sells external storage biz to NetApp

Semiconductor, storage and networking vendor LSI Corporation is walking away from the external storage systems game with $480m (£298m) in its back pocket after selling its Engenio business to NetApp.

"NetApp is well positioned to enhance the value of the Engenio business. [Its] channel-friendly approach is synergistic with the Engenio model of enabling partner and customer success," said LSI CEO Abhi Talwalkar.

"The combination should further advance the Engenio platform as well as augment the OEM channels that have been the foundation of its success," he added.

NetApp is keen to attack new areas of the market that it cannot currently reach with its FAS platform, said CEO Tom Georgens, and is betting that taking ownership of the Engenio lines will enable it to target growth in video and high performance computing, among other things.

The Engenio business unit will be folded into NetApp's business operations and will be responsible for product development with Manish Goel, executive vice president of NetApp Product Operations, at the helm.

The acquisition should be accretive to NetApp's EPS, the firm said, and will close by the end of May.

LSI told Reuters it plans to use the proceeds of the sale to fund a stock repurchase programme.

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